Research paper
In
English II

Roeniel Jetrew Galon
BSBA- 1B Sir Dennis Duyag
Introduction
Corruption has recently become a major issue in foreign aid policies. However, behind the screens it has always been there, referred to as the “c-word”. The major concern for international aid policy through the last five decades is to improve the living conditions for the poor in the poorest countries of the world. This endeavour requires a close co-operation with the national governments in poor countries. Generally speaking, however, the governments in poor countries are also the most corrupt. This is one of the few clear empirical results of recent research on corruption. The level of GDP per capita holds most of the explanatory power of the various corruption indicators (Treisman, 2000; Paldam, 1999a). Consequently, if donors want to minimise the risk of foreign aid being contaminated by corruption, the poorest countries should be avoided. This would, however, make aid policy rather pointless. This is the basic dilemma corruption raises for aid policy. Unlike international business most development aid organisations and international finance institutions have the lion’s share of their activities located in highly corrupt countries (Alesina and Weder, 1999). The international community in general and some donor countries in particular are, however, increasingly willing to fight corruption. Within the “good governance” strategies of the World Bank and the International Monetary Fund initiatives to curb corruption are given priority. OECD and the UNDP have also developed particular anti-corruption programmes to assist governments in tackling the problem. Furthermore, several bilateral development agencies have placed anti-corruption efforts high on their development agenda. Whether this is a desirable change in focus of aid policy, and, hence,